View
19
Download
0
Category
Preview:
Citation preview
ICAO: International Civil
Aviation Organization Background Guide
Chair: Navar Recinos
Email: recinosn@bc.edu
International Civil Aviation Organization
Letter from the Chair
Hello Delegates, Welcome to EagleMUNC IX! My name is Navar Recinos, and I am a Senior at Boston
College where I am majoring in Mathematics and minoring in Physics. This is my third year as a
member of EagleMUNC and my first time chairing at a conference. Within the past three years,
some of my fondest college memories come from being a part of the EagleMUNC family. The
conferences are, in my opinion, one of the best events for students to create memories and bond
with one another. I hope by the end of the weekend you will all have your own special memories.
Our committee will be simulating the International Civil Aviation Organization (ICAO)
where we’ll be dealing with issues currently facing the aviation industry. Issues ranging from
security to environmental impact. Aviation is a large part of our modern day society so everyone
should be able to connect to it in some way. I hope it will be as informative as it is fun. I’m
excited to experience my first time chairing with you and hope to make this conference a
memorable one. If you have any questions, please feel free to contact me. Until then, I can’t wait
to meet you at the conference.
Best Wishes,
Navar Recinos
International Civil Aviation Organization
Background Information:
The International Civil Aviation Organization (ICAO) is a UN specialized agency that
was established at the 1944 Chicago Convention to manage the administration and governance of
the Convention on International Civil Aviation.1 The ICAO handles safety, registration,
airworthiness, fair competition, standardization, aviation law, and the prevention of economic
waste. The organization is made up of the Secretariat, an Assembly, and a Council, which is
internally made up of the different bodies. The Chief Officers are the President of the Council
and the Secretary General.2
Composed of representatives from the member states, the Assembly is the sovereign
body of the organization. They are tasked with reviewing the work of the organization,
establishing policies every three years, and apportioning out the triennial budget.3 In addition, the
Assembly is responsible for electing the states which make up the Council. Should the Assembly
be unable to reach a decision, they may delegate the power to do so to the Council. It is also up
to the Assembly to approve amendments of their constitution for the organization.4
ICAO Council Discussing COVID-19, Montreal, 20205
1 “About ICAO // ,” About ICAO, https://www.icao.int/about-icao/Pages/default.aspx. 2 “SKYbrary Wiki,” International Civil Aviation Organisation (ICAO) - SKYbrary Aviation Safety,https://www.skybrary.aero/index.php/International_Civil_Aviation_Organisation_(ICAO). 3 “SKYbrary Wiki,” 4 “Assembly // ,” Assembly, https://www.icao.int/about-icao/assembly/Pages/default.aspx. 5 Raillant-Clark, William. “ICAO Council Agrees to the Safeguard Adjustment for CORSIA in Light of COVID-19 Pandemic // ,” n.d. https://www.icao.int/Newsroom/Pages/ICAO-Council-agrees-to-the-safeguard-adjustment-for-CORSIA-in-light-of-COVID19-pandemic.aspx.
International Civil Aviation Organization
Council members serve for three-year terms and each represent one of 36 states. These
states are selected based on the following: the states most important to air transport, the states
with the largest contribution to the provision of facilities for air navigation, and the states
necessary to represent all major areas of the world. The Council is led by a president who can
serve an unlimited number of three-year terms and is able to be reelected. Currently, Salvatore
Sciacchitano is President of the Council, and his term began in January 2020. It is up to the
Council to create standards and recommended practices for the organization. When needed, they
will look to their subcommittees to handle specific issues such as the Air Navigation Committee
for technical issues, the Air Transport Committee for economic issues, and the Committee on
Joint Support of Air Navigation Services for remaining issues.6 The Council also submits reports
to the Assembly regarding the status of the organization and carries out any tasks that the
Assembly requires. Additionally, they hold the power to investigate matters regarding the safety
of international travel. Just as the Assembly elects the states for the Council, it is up to the
Council to elect the Secretary General of the ICAO, who serves in the UN’s Secretariat. At the
moment, the Council’s main objectives are safety, air navigation capacity and efficiency,
security, economic development, and environmental protection.7
The Secretariat of the organization is made up of the Air Navigation Bureau, Air
Transport Bureau, Technical Cooperation Bureau, Legal Bureau, and the Bureau of
Administration and Services.8 In addition to these five bureaus, there are also the seven regional
offices of the ICAO. They are located in Bangkok, Thailand (Asia and Pacific); Nairobi, Kenya
6 “SKYbrary Wiki,” International Civil Aviation Organisation (ICAO) - SKYbrary Aviation Safety, https://www.skybrary.aero/index.php/International_Civil_Aviation_Organisation_(ICAO). 7 “The ICAO Council // ,” The ICAO Council, https://www.icao.int/about-icao/Council/Pages/Council.aspx. 8 “SKYbrary Wiki,” International Civil Aviation Organisation (ICAO) - SKYbrary Aviation Safety, https://www.skybrary.aero/index.php/International_Civil_Aviation_Organisation_(ICAO).
International Civil Aviation Organization
(Eastern and Southern Africa); Dakar, Senegal (Western and Central Africa); Cairo, Egypt
(Middle East); Paris, France (Europe and North Atlantic); Lima, Peru (South America); Mexico
City, Mexico (North/Central America and Caribbean). All bureaus are led by the Secretary
General. Besides leading the Secretariat, the Secretary General is also responsible for carrying
out any needs of the Council and giving them status reports on the Secretariat. Similar to the
President of the Council, the Secretary General serves a three-year term and can be reelected. Dr.
Fang Liu is the current Secretary General, and she started her second term in March 2018.9
All three levels of the ICAO are guided by (or are involved in the creation of) broader
principles. The principles for the ICAO are called Standard and Recommended Practices
(SARPs) and Procedures for Air Navigation (PANs). SARPs and PANs are important to the
ICAO because they lay out safety rules, performance requirements, and other essential
information for air transport. When it comes to creating SARPs and PANs, the different bodies
and subcommittees from the ICAO will come together and follow the amendment process to see
whether the addition is suitable. For the most part, it takes about two years for a standard or
procedure to be approved.10
The ICAO currently has five main objectives, the first of which is safety. In order to
maintain the safety of air travel, the organization develops strategies that are part of their Global
Aviation Safety Plan and Global Air Navigation Plan, and new standards and procedures to
ensure that safety measures are continuously updated. The Council also monitors safety trends
and indicators which can help with issues such as dealing with aviation systems disruptions
caused by natural disasters.11 The ICAO also concerns itself with capacity and efficiency,
9 “ICAO Secretariat // ,” ICAO Secretariat,https://www.icao.int/secretariat/Pages/default.aspx. 10 “How ICAO Develops Standards // ,” How ICAO Develops Standards, https://www.icao.int/about-icao/AirNavigationCommission/Pages/how-icao-develops-standards.aspx. 11 “Safety // ,” Safety,https://www.icao.int/safety/Pages/default.aspx.
International Civil Aviation Organization
focusing on how to handle large volumes of passengers or aircrafts, in order to prevent
congestion and maximize the efficiency of air travel.12 For their security objective, they focus on
acts of sabotage, unlawful seizures of aircrafts, and the use of aircrafts in terrorist attacks. It also
focuses on traveling documents and the training of airport security.13 When it comes to economic
development, the organization has seven goals:
A coherent and harmonized global regulatory framework for international air transport,
thereby removing impediments to economic sustainability and maximizing aviation’s
contribution to economic development.
The securing of, and increased accessibility to funding for aviation infrastructure and
States’ oversight functions, as well as efficient use of resources and technologies.
Solutions to overcome infrastructure and airspace capacity constraints and improve
organizational and managerial capabilities and corporate governance.
Better cooperation amongst the aviation community and all aviation stakeholders, and
smooth adaptation to the changes in civil aviation, the global business environment and the
market.
Significant savings by States in conducting air services negotiations, and performing
regulatory functions.
The availability of accurate, reliable and consistent aviation data for States’ decision-
making and accountability, and for operations transparency to all the air transport stakeholders
and markets.
12 “Air Navigation Capacity and Efficiency // ,” Air Navigation Capacity and Efficiency, https://www.icao.int/airnavigation/Pages/default.aspx. 13 “Security // ,” Security, https://www.icao.int/Security/Pages/default.aspx.
International Civil Aviation Organization
And finally, the availability of tools and forecasting necessary to measure and, to the
extent possible, predict the various aspects of civil aviation development.14
A final, but important, aspect of the ICAO agenda is the discussion and implementation
of environmental protection. The ICAO seeks to limit the number of people affected by aircraft
noise, reduce the impact of emissions on air quality, and reduce the impact of greenhouse gas
emissions on the global climate.15
Topic1: Environmental Impact
The first major issue affecting the aviation industry is its environmental impact. As the
industry grows, it creates a stronger impact on both local environments and the world as a whole.
The primary issue at the local level is noise pollution, which is most common around airports or
under common air routes.. According to the World Health Organization, the effects that noise
pollution have on humans include hearing impairment, pain, sleep disturbance, stress,
psychophysiological reactions during sleep, cardiovascular effects, deficits in reading acquisition
among children, and effects on social behavior.16 While other industries have already started to
decrease their ground-level emissions, airplanes still emit volatile organic compounds and
nitrogen oxides. Although the airplanes themselves contribute to emissions issues, airports are
also a significant part of the problem. At the airports, taxis, buses, and other vehicles constantly
produce exhaust as they are stuck in traffic.17 These emissions affect the people living around the
14 “Economic Development of Air Transport // ,” Economic Development of Air Transport, https://www.icao.int/sustainability/Pages/default.aspx. 15 “Environmental Protection // ,” Environmental Protection, https://www.icao.int/environmental-protection/Pages/default.aspx. 16 Whitelegg, John. “AVIATION: the Social, Economic and Environmental Impact of Flying,” January 2000. 17 Whitelegg, John.
International Civil Aviation Organization
airports or under the flight routes by contributing to health issues, especially for those with pre-
existing respiratory issues.
Diagram Representing the Impact of Air Travel on the Climate18
On the global level, the aviation industry has a sizable carbon footprint. Aviation
produces about two percent of all human induced CO2 emissions. However, CO2 is not the only
gas emitted. Aircraft fumes are about 8% percent CO2 and water vapour; and 0.03% nitrogen
oxides, carbon monoxide, sulphur oxides, and unburned hydrocarbons. The remaining
percentage of about 92% is normal atmospheric oxygen and nitrogen. The water vapour that is
emitted is also believed to have an impact, however it is unknown whether that impact is
warming or cooling the climate. By this, researchers mean that the water vapor can form into
cirrus clouds which can create different warming or cooling effects based on the time of day the
flight occurs. Since the effects are still being looked into, the extent of water vapor’s effect can’t
18 “The Impact of Air Travel on Our Climate,” atmosfair, n.d., https://www.atmosfair.de/en/air_travel_and_climate/flugverkehr_und_klima/climate_impact_air_traffic/.
International Civil Aviation Organization
be told compared to other greenhouse gases.19 These gases have varying impacts based on
altitude. The water vapours and nitrogen oxides have a greater effect in high altitudes, while CO2
has the same effect no matter the altitude.20 This is important when looking at how planes will
fly at different altitudes depending on their flight path or its model. While the industry is
attempting to decrease its emissions, aircraft are still contributing to global climate change.
Another global effect that airlines have is water pollution. Sometimes, in order to make
landing easier, aircrafts will lighten themselves by dumping excess fuel into nearby bodies of
water. This will pollute the water and harm the wildlife that lives in it or depends on it. In early
2020, a Delta Airlines flight dropped fuel in a community of California. The load landed on an
elementary school and caused some injuries to students, but nothing severe. The actions that
aviation companies take aren’t only polluting the water, but can also have unforeseen
consequences on the surrounding communities.
While aircrafts are contributing to climate change, they are also being affected by it. As
global warming worsens, weather can become more unpredictable or unfavorable. When this
happens, airplanes cannot fly and more have to be grounded until the weather becomes suitable.
Also if airlines wish to continue to send their aircrafts, then they must look for new routes to
avoid the unsuitable weather conditions which may make the trips longer.
Topic 2:Aging Technology and System Failures
Another crucial issue that the aviation industry is currently facing is aging technology
and system failures. Aviation technology has not progressed in the past few years, and models
19 “Aviation's Impact on the Environment,” Aviation, n.d., https://aviationbenefits.org/environmental-efficiency/aviations-impact-on-the-environment/. 20 “Aviation's Impact on the Environment,” Aviation, n.d., https://aviationbenefits.org/environmental-efficiency/aviations-impact-on-the-environment/.
International Civil Aviation Organization
have remained the same with no noticeable changes. It is due to this lack of advancements that
more aircrafts are starting to suffer from system failures, such as circuits not working properly.21
In recent years we have seen IT failures and blackouts from companies such as Delta, United,
and Southwest Airlines.22 These issues have made the companies ground many of their aircrafts,
resulting in irritated customers stuck at airports. This leads to customers asking for refunds and
companies receiving negative press, so they suffer financially. In order to better their technology,
companies attempt to create mergers with other companies to share their technology.23 However,
this is still not enough. Airline companies have trouble investing in advancements because they
have a small budget to spend in new technology. The large taxes they face leave them with little
extra to spend.24 Historically, airlines have chosen to put liquid assets towards security and
safety, two elements crucial for air travel, but not towards the advancement of the aircraft’s
mechanical technology. With such high risks directly impacting consumers, airline companies
face additional constraints that do not burden many other industries.25 If they started investing in
other elements and let their security become obsolete, then they have made themselves
21 Justin Bachman, “Airline IT Failures Expose Systems That Are a Mix of Really Old and New Technologies,” Skift (Bloomberg, February 7, 2017), https://skift.com/2017/02/07/airline-it-failures-expose-systems-that-are-a-mix-of-really-old-and-new-technologies/ 22 Justin Bachman, “Airline IT Failures Expose Systems That Are a Mix of Really Old and New Technologies,” Skift (Bloomberg, February 7, 2017), https://skift.com/2017/02/07/airline-it-failures-expose-systems-that-are-a-mix-of-really-old-and-new-technologies/ 23 Justin Bachman, “Airline IT Failures Expose Systems That Are a Mix of Really Old and New Technologies,” Skift (Bloomberg, February 7, 2017), https://skift.com/2017/02/07/airline-it-failures-expose-systems-that-are-a-mix-of-really-old-and-new-technologies/ 24 Justin Bachman, “Airline IT Failures Expose Systems That Are a Mix of Really Old and New Technologies,” Skift (Bloomberg, February 7, 2017), https://skift.com/2017/02/07/airline-it-failures-expose-systems-that-are-a-mix-of-really-old-and-new-technologies/. 25 Laura Sydell, “Why The Airline Industry Could Keep Suffering System Failures Like Delta's,” NPR (NPR, August 9, 2016), https://www.npr.org/sections/alltechconsidered/2016/08/09/489355923/why-the-airline-industry-could-keep-suffering-system-failures-like-deltas.
International Civil Aviation Organization
vulnerable to hackers or terrorists.26 Thus, security has trumped technology innovation and
maintenance in the short term, building a long-term technological debt which is now coming due.
Breakdown of Materials For a Boeing 78727
Like obsolete electrical systems, obsolete mechanical parts can interfere with the smooth
operation of aircraft. Parts of airplanes are exposed to high temperatures, high pressures, stress,
corrosion, and impact damage.28 As time passes, these parts start degrading and require
replacements, but this is not an easy process. As the aircrafts become older, it becomes more
difficult to find replacement parts. This is mainly because of a lack of availability or because the
manufacturers have stopped producing it.29 Production of parts tends to stop once an aircraft
reaches a certain “age.” But how does one define an aircraft's age to know if it is obsolete? For
26 Laura Sydell, “Why The Airline Industry Could Keep Suffering System Failures Like Delta's,” NPR (NPR, August 9, 2016), https://www.npr.org/sections/alltechconsidered/2016/08/09/489355923/why-the-airline-industry-could-keep-suffering-system-failures-like-deltas. 27 Michael Baudin, “The Boeing 787 Development Story,” Michel Baudin's Blog, April 2, 2017, https://michelbaudin.com/2017/04/02/the-boeing-787-developmentlaunch-story/. 28 Ionel Botef, “(PDF) Aging Aircrafts: Concerns and Possible Solutions,” ResearchGate, September 2012, https://www.researchgate.net/publication/259531339_Aging_Aircrafts_Concerns_and_Possible_Solutions. 29 Ionel Botef, “(PDF) Aging Aircrafts: Concerns and Possible Solutions,” ResearchGate, September 2012, https://www.researchgate.net/publication/259531339_Aging_Aircrafts_Concerns_and_Possible_Solutions.
International Civil Aviation Organization
starters, manufacturers look at the number of flight cycles and the number of engine hours.30 On
average an aircraft lasts about 30 years before needing to be retired.31 Therefore, companies need
to also focus on improving their mechanical systems in order to make sure none of the plane’s
parts become obsolete or the plane as a whole becomes obsolete. While all planes will eventually
need to retire no matter how advanced they are, it is important to have them fully functional in
the meantime for safe travel.
The obsolete systems and aging parts lead to the issue of aviation accidents. Crashes can
be caused by a variety of factors, including: control surfaces becoming stuck and preventing
proper control; hydraulic systems failing, causing the plane to be unable to land properly; fuel
leaks shortening the range of the plane or causing fires; instrument failures deceiving pilots; and
the failing of de-icing, pressurization, electrical, or mechanical equipment.32 An example of a
simple failure leading to a severe crash was in 1994 when an airplane crashed while trying to
land and thus killed everyone on board. The cause was an uncontrollable rudder due to a design
defect within the rudder power unit.33 Obsolete components and mechanical systems are just as
crucial as the electrical systems when it comes to an aircrafts components, thus solutions should
be created on how companies can equally advance both systems.
30 Ionel Botef, “(PDF) Aging Aircrafts: Concerns and Possible Solutions,” ResearchGate, September 2012, https://www.researchgate.net/publication/259531339_Aging_Aircrafts_Concerns_and_Possible_Solutions. 31 Dan Wang, “How Are Planes Decommissioned and How Much Value Can Be Salvaged?,” Flexport, April 12, 2016, https://www.flexport.com/blog/decommissioned-planes-salvage-value/. 32 Chris Daniel, “AIRCRAFT DEFECTS AND THEIR CONSEQUENCES,” McCARTNEY STUCKY LLC, January 20, 2019, https://mccartneystucky.com/aircraft-defects-and-their-consequences/ 33 Chris Daniel, “AIRCRAFT DEFECTS AND THEIR CONSEQUENCES,” McCARTNEY STUCKY LLC, January 20, 2019, https://mccartneystucky.com/aircraft-defects-and-their-consequences/.
International Civil Aviation Organization
Topic 3: Costs
A third issue impacting the aviation industry is the increasing costs of expanding
operations. The two main costs that affect airlines are fuel and labor. The cost for fuel is 10-12%
of a company’s expenses, while labor is about 35% of the expenses, on average.34 The rest of the
expenses include maintenance, parts and labor, luggage handling, airport fees, taxes, marketing,
promotions, travel agent commissions, and passenger expenses.35 In general, the costs can be
split into two types: operational and functional. Operational costs consist of salaries, materials,
services purchased, and rentals and fees. The functional costs include aircraft operations, aircraft
services, traffic services, passenger services, reservation and sales, and other costs associated
with marketing and administration.36 So the fuel costs would fall under functional costs since it
deals with the aircrafts’ operations and services, while labor falls under operational and
functional since it’s associated with salaries for the labor and the labor being done is a service to
the aircraft.
The breakdown of costs for major US airlines provides a reference point for typical
expense distribution. 44% of costs are aircraft operations (fuel, maintenance, and crew), 29% are
servicing expenses, 14% are reservations and sales, and 13% are overhead expenses. Aircraft
operations can further be broken down by aircraft and route type. For instance, for a Boeing 757,
total flight operating costs are $2550 per block hour.37 A block hour is the time from the moment
the aircraft door closes at departure until the moment the door opens at the arrival gate.38 In other
34 Brian Beers, “Which Major Expenses Affect Airline Companies?,” Investopedia (Investopedia, June 25, 2019), https://www.investopedia.com/ask/answers/040715/what-are-major-expenses-affect-companies-airline-industry.asp. 35 Brian Beers, “Which Major Expenses Affect Airline Companies?,” Investopedia (Investopedia, June 25, 2019), https://www.investopedia.com/ask/answers/040715/what-are-major-expenses-affect-companies-airline-industry.asp. 36 “ICAO: Airline Operating Costs and Productivity.” Tehran: ICAO, February 20, 2017. 37 Tehran: ICAO. 38 Tehran: ICAO.
International Civil Aviation Organization
words, when the blocks are removed from under the wheel of the aircraft so it can depart the
terminal to when the aircraft lands at its destination terminal and blocks are placed under again.
Hence the name “block hour.” It doesn’t matter if a trip is 6 or 16 hours, it will still be
considered one block hour. Generally, larger aircrafts have higher flight operating costs per
block hour, partly because pilots who fly large aircrafts internationally are paid more. However,
smaller aircrafts have higher costs per seat hour. These costs are all based on the aircraft and
employee productivity, which in turn is based on a variety of different factors. These factors
include more flight departures per day, longer stage lengths, and more seats in similar aircraft
types. Employee productivity is impacted by longer stage lengths, larger aircraft sizes, and
increased aircraft productivity due to shorter turnaround times.39
U.S. Airline Operating Costs in 201940
39 Tehran: ICAO. 40 “Passenger Airlines Operating Costs, United States, 2019,” The Geography of Transport Systems, March 31, 2020, https://transportgeography.org/?page_id=7287.
International Civil Aviation Organization
So what happens when costs get too high for airline companies? Airline companies will
resort to laying off workers or reducing their pay and benefits, or they will raise the price of their
tickets.41 These actions can actually end up doing more harm than good for the companies’
bottom lines. If benefits are reduced, then employees may quit or protest. In Europe, there have
been pilot walkouts which creates a shortage, so now the companies are finding it difficult to
have their aircrafts in the sky since there is no one to fly them.4243 This means that the companies
cannot schedule trips and thus lose money on ticket purchases. If ticket prices increase, then
fewer people will wish to purchase them; many may seek out a cheaper option. Increasing ticket
prices passes the costs onto consumers. Recently, this has been driven by high fuel prices. In July
of 2019, U.S. airlines spent $3 billion on fuel.44 While there has been slight decreases in fuel
costs, it is still a major issue the industry faces. Balancing rising costs with employee demands
and consumer desires poses a continual challenge for the aviation industry.
Topic 4: Competition
Aviation competition has arisen as an issue in a world increasingly reliant on air travel.
Smaller corporations find themselves unable to keep up with the more mainstream corporations,
so they have to either disband or merge with another corporation. Major corporations, on the
other hand, have to compete with one another. The main part of this competition is each other’s
41 Brian Beers, “Which Major Expenses Affect Airline Companies?,” Investopedia (Investopedia, June 25, 2019), https://www.investopedia.com/ask/answers/040715/what-are-major-expenses-affect-companies-airline-industry.asp. 42 “Business & Human Rights Resource Centre,” Ryanair's German pilots join Europe-wide strikes over labour rights - Business & Human Rights Resource Centre, July 31, 2018, https://www.business-humanrights.org/en/latest-news/ryanairs-german-pilots-join-europe-wide-strikes-over-labour-rights/. 43 Gregory Katz, “British Airways Forced to Cancel Most Flights After Pilot Walkout,” Skift, September 9, 2019, https://skift.com/2019/09/09/british-airways-forced-to-cancel-most-flights-after-pilot-walkout/. 44 “What the Cost of Airline Fuel Means to You,” U.S. Department of Transportation, September 13, 2019, https://www.transportation.gov/administrations/assistant-secretary-research-and-technology/what-cost-airline-fuel-means-you.
International Civil Aviation Organization
reputation. If one airline corporation has recently received a bad reputation, then the other
corporations will take that advantage to better their own business.
Best Airlines of 201945
Originally all airlines had similar fares and routes due to the Civil Aeronautics Board,
which was a government agency that regulated commercial airlines.46 Competition began once
regulations were decreased in the late 1970s and companies were given their own liberties. The
fares started off low, which meant more customers were able to purchase seats. However, as
more and more customers filled the seats, the flight experience started to decline. Thus,
companies introduced classes of airline tickets to provide those willing to pay extra a more
enjoyable experience.
The industry greatly changed after 9/11 and the Great Recession, driving down
competition. From 2005-2015 many major airlines merged together to form the remaining major
companies: American, United, Delta, and Southwest. In 2015, these four companies controlled
45 Masha Maksimava, “10 Best Airlines of 2019: A Social Listening Report,” Awario Blog (Awario, June 1, 2020), https://awario.com/blog/airline-industry-social-listening-report/. 46 Scott A. Wolla and Carolyn Backus, “The Economics of Flying: How Competitive Are the Friendly Skies?,” Economic Research - Federal Reserve Bank of St. Louis, November 2018, https://research.stlouisfed.org/publications/page1-econ/2018/11/01/the-economics-of-flying-how-competitive-are-the-friendly-skies/.
International Civil Aviation Organization
80% of the U.S. market. This made the airline industry an oligopoly, which makes it difficult for
smaller companies to succeed. However, the small companies started to expand their routes
causing a new form of competition. The rise of the lower cost companies has placed pressure on
the larger companies to provide a basic economy class in order to attract low-budget customers.47
Currently, the most competitive global markets are China, the United States, India, Indonesia,
and Brazil.48
To compete globally, airlines must factor in changing customer preferences based on
region. The culture of a region can impact how people travel. Some may travel due to business
while others may be traveling for leisure; some may be more comfortable with long trips while
others may be accustomed to short hops. For instance, international business travelers from the
UK are more likely to see seat comfort as a priority while business travelers from China will
prioritize premium services such as rebooking.49 Airline companies need to take into account
these regional differences in order to beat the competition.
There has been a great increase in competition in the airline industry recently. As a result
capacities have begun to increase, services have improved, and the fares have been decreased.50
If fares seem to be low across the field, then how do customers choose which company to give
their business to? The main factor is reputation. Customers are going to select the airline with the
best services. This can include entertainment, food, comfortable seating, and how employees
47 Scott A. Wolla and Carolyn Backus, “The Economics of Flying: How Competitive Are the Friendly Skies?,” Economic Research - Federal Reserve Bank of St. Louis, November 2018, https://research.stlouisfed.org/publications/page1-econ/2018/11/01/the-economics-of-flying-how-competitive-are-the-friendly-skies/. 48 Teresa Cederholm, “Competition in Airline Industry,” Market Realist, December 31, 2019, https://marketrealist.com/2014/12/low-entry-barriers-intensify-competition-airline-industry/. 49 Teresa Cederholm, “Competition in Airline Industry,” Market Realist, December 31, 2019, https://marketrealist.com/2014/12/low-entry-barriers-intensify-competition-airline-industry/. 50 John P Heimlich, “U.S. Airline Competition Has Intensified, Leading to More Air Service and Lower Prices for Consumers,” Airlines For America, accessed July 12, 2017, https://www.airlines.org/blog/u-s-airline-competition-has-intensified-leading-to-more-air-service-and-lower-prices-for-consumers/.
International Civil Aviation Organization
treat them. In 2017, a viral video of a United flight showed a doctor be forcibly dragged off the
plane.51 When the video was released, United faced severe backlash. They lost business to the
other major airlines because customers did not wish to give money to a company they believed
mistreated their passengers. Thus, the reputation of the companies is key to their success.
Without customers, they cannot succeed, no matter how well they are handling the other
previously mentioned issues. More so now than ever, reputation and public presence play a
significant role in airline competition.
Bloc Positions
This body represents the ICAO in 2021. It will be made up of the most important country
members as well as aviation corporations. The countries’ interests and goals will be different
than those of the corporations. Countries will focus more on their economies and national
security. Some countries will want to improve their security more than others and may work with
those who wish to do the same. The corporations on the other hand will be more concerned about
themselves. They are present to represent themselves and provide a voice in the countries’
decisions that will affect their business. They will work with other corporations in order to help
push or reject a policy, or may even have to merge together in order to overcome an issue. While
there won’t be strong competition amongst the countries, it can occur between the corporations.
As mentioned, the committee takes place in 2021. Delegates should therefore be aware of
how the ICAO currently operates and policies that are in motion. It should also be beneficial to
know key past events or policies that may affect current decision making. Other important
51 Julia Jacobo and Cameron Harrison, “Doctor Dragged off United Airlines Flight after Watching Viral Video of Himself: 'I Just Cried',” ABC News (ABC News Network, April 9, 2019), https://abcnews.go.com/US/doctor-dragged-off-united-airlines-flight-watching-viral/story?id=62250271.
International Civil Aviation Organization
information is the current status of the aviation corporations and the primary concerns of
different countries with regards to aviation. Since this is occurring in 2021, COVID-19 will have
impacted both countries and corporations. The countries will probably want to focus on how to
limit spread through air travel while the corporations will try to financially recover and provide
assurance to travelers that it is safe to fly. Knowing how each country is dealing with this
obstacle is also relevant. Some countries that will be represented are the United States, United
Kingdom, China, and France52 while the corporation will include companies such as Boeing, Air
France, Cessna, American Airlines, and Emirates.
Questions to Consider
Environmental Impact
+ While we see the impact that noise pollution has on humans, what’s its effect on the
nature around an airport?
+ Besides pollution, how else are the development of airports impacting the environment?
+ As for the aircrafts themselves, would increasing capacity to decrease sky traffic lower
emissions or increase them since the crafts are larger?
+ In the car industry, we see a push for more electrical vehicles, is it possible to create an
electrical airplane?
+ Lastly, it was mentioned how climate change is affecting air travel. If things continue to
worsen, what better ways can airlines make up for the changes rather than simply
cancelling flights?
Aging Technologies
52 “Member States // ,” Member States, n.d., https://www.icao.int/about-icao/Pages/member-states.aspx.
International Civil Aviation Organization
+ When it comes to aging technology, delegates should wonder why there has been a lack
of progress?
+ Besides cost, is there a lack of interest in terms of people who wish to enter the field?
+ Is focusing so much on system security worth it if the aircraft keep failing mechanically?
+ Is there a way that the companies can find a balance between investing in security and
more advanced aircrafts?
+ How can countries help companies better their aircrafts?
+ Are countries interested in the advancement of the industry or are they content with how
it is now?
Cost
+ Would investing a new form of fuel be worth the cost rather than paying the high price of
the current fuel?
+ Does increasing ticket prices benefit or harm the industry?
+ What can companies, especially in Europe, do in order to prevent more walkouts from
pilots?
+ Rather than spend on developing airports, can countries invest in companies to help them
thrive?
+ Would reducing functional costs be more beneficial than reducing operational costs?
Competition
+ When two companies merge, what are some issues that may arise?
+ One point that was previously mentioned was how customers have no loyalty. So how
can airline companies create loyalty?
International Civil Aviation Organization
+ With the recent COVID-19 pandemic, how can companies assure the public that it’s safe
to fly on their airlines?
+ How does a country impact the competition between airlines, both domestically and
internationally?
All of these questions should help guide discussion and decisions during the course of the
conference. Feel free to draft responses to help guide your anticipated direction of committee and
position paper.
International Civil Aviation Organization
Works Cited: “About ICAO,” About ICAO, https://www.icao.int/about-icao/Pages/default.aspx. “Air Navigation Capacity and Efficiency,” Air Navigation Capacity and Efficiency,
https://www.icao.int/airnavigation/Pages/default.aspx. “Assembly,” Assembly, https://www.icao.int/about-icao/assembly/Pages/default.aspx. “Aviation's Impact on the Environment,” Aviation, n.d.,
https://aviationbenefits.org/environmental-efficiency/aviations-impact-on-the- environment/.
Bachman, Justin. “Airline IT Failures Expose Systems That Are a Mix of Really Old and New
Technologies,” Skift (Bloomberg, February 7, 2017), https://skift.com/2017/02/07/airline-it-failures-expose-systems-that-are-a-mix-of-really- old-and-new-technologies/
Baudin, Michael. “The Boeing 787 Development Story,” Michel Baudin's Blog, April 2, 2017,
https://michelbaudin.com/2017/04/02/the-boeing-787-developmentlaunch-story/. Beers, Brian. “Which Major Expenses Affect Airline Companies?,” Investopedia (Investopedia,
June 25, 2019), https://www.investopedia.com/ask/answers/040715/what-are-major- expenses-affect-companies-airline-industry.asp.
Botef, Ionel. “(PDF) Aging Aircrafts: Concerns and Possible Solutions,” ResearchGate,
September 2012, https://www.researchgate.net/publication/259531339_Aging_Aircrafts_Concerns_and_Possible_Solutions.
“Business & Human Rights Resource Centre,” Ryanair's German pilots join Europe-wide strikes
over labour rights - Business & Human Rights Resource Centre, July 31, 2018, https://www.business-humanrights.org/en/latest-news/ryanairs-german-pilots-join- europe-wide-strikes-over-labour-rights/.
Cederholm, Teresa. “Competition in Airline Industry,” Market Realist, December 31, 2019,
https://marketrealist.com/2014/12/low-entry-barriers-intensify-competition-airline-industry/.
Daniel, Chris. “AIRCRAFT DEFECTS AND THEIR CONSEQUENCES,” McCARTNEY
STUCKY LLC, January 20, 2019, https://mccartneystucky.com/aircraft-defects-and- their-consequences/
“Economic Development of Air Transport,” Economic Development of Air Transport,
https://www.icao.int/sustainability/Pages/default.aspx.
International Civil Aviation Organization
“Environmental Protection // ,” Environmental Protection, https://www.icao.int/environmental- protection/Pages/default.aspx.
Heimlich, Teresa. “U.S. Airline Competition Has Intensified, Leading to More Air Service and
Lower Prices for Consumers,” Airlines For America, accessed July 12, 2017, https://www.airlines.org/blog/u-s-airline-competition-has-intensified-leading-to-more-air-service-and-lower-prices-for-consumers/.
“How ICAO Develops Standards,” How ICAO Develops Standards, https://www.icao.int/about-
icao/AirNavigationCommission/Pages/how-icao-develops-standards.aspx. “ICAO: Airline Operating Costs and Productivity.” Tehran: ICAO, February 20, 2017. “ICAO Secretariat,” ICAO Secretariat,https://www.icao.int/secretariat/Pages/default.aspx. Jacobo, Julia and Cameron Harrison, “Doctor Dragged off United Airlines Flight after Watching
Viral Video of Himself: 'I Just Cried',” ABC News (ABC News Network, April 9, 2019), https://abcnews.go.com/US/doctor-dragged-off-united-airlines-flight-watching- viral/story?id=62250271.
Katz, Gregory. “British Airways Forced to Cancel Most Flights After Pilot Walkout,” Skift,
September 9, 2019, https://skift.com/2019/09/09/british-airways-forced-to-cancel-most- flights-after-pilot-walkout/.
Maksimava, Masha. “10 Best Airlines of 2019: A Social Listening Report,” Awario Blog
(Awario, June 1, 2020), https://awario.com/blog/airline-industry-social-listening-report/. “Passenger Airlines Operating Costs, United States, 2019,” The Geography of Transport
Systems, March 31, 2020, https://transportgeography.org/?page_id=7287. Raillant-Clark, William. “ICAO Council Agrees to the Safeguard Adjustment for CORSIA in
Light of COVID-19 Pandemic // ,” n.d. https://www.icao.int/Newsroom/Pages/ICAO- Council-agrees-to-the-safeguard-adjustment-for-CORSIA-in-light-of-COVID19- pandemic.aspx.
“Safety,” Safety,https://www.icao.int/safety/Pages/default.aspx. “Security,” Security, https://www.icao.int/Security/Pages/default.aspx. “SKYbrary Wiki,” International Civil Aviation Organisation (ICAO) - SKYbrary Aviation
Safety,https://www.skybrary.aero/index.php/International_Civil_Aviation_Organisation_ (ICAO)
Sydell, Laura. “Why The Airline Industry Could Keep Suffering System Failures Like Delta's,”
NPR (NPR, August 9, 2016), https://www.npr.org/sections/alltechconsidered/2016/08/09/489355923/why-the-airline-
International Civil Aviation Organization
industry-could-keep-suffering-system-failures-like-deltas. “The ICAO Council,” The ICAO Council, https://www.icao.int/about-
icao/Council/Pages/Council.aspx. “The Impact of Air Travel on Our Climate,” atmosfair, n.d.,
https://www.atmosfair.de/en/air_travel_and_climate/flugverkehr_und_klima/climate_imp act_air_traffic/.
Wang, Dan. “How Are Planes Decommissioned and How Much Value Can Be Salvaged?,”
Flexport, April 12, 2016, https://www.flexport.com/blog/decommissioned-planes- salvage-value/.
“What the Cost of Airline Fuel Means to You,” U.S. Department of Transportation, September
13, 2019, https://www.transportation.gov/administrations/assistant-secretary-research- and-technology/what-cost-airline-fuel-means-you.
Whitelegg, John. “AVIATION: the Social, Economic and Environmental Impact of Flying,”
January 2000. Wolla, Scott A. and Carolyn Backus, “The Economics of Flying: How Competitive Are the
Friendly Skies?,” Economic Research - Federal Reserve Bank of St. Louis, November 2018, https://research.stlouisfed.org/publications/page1-econ/2018/11/01/the-economics-of-flying-how-competitive-are-the-friendly-skies/.
Recommended